Spill claims administrator must show flexibility

As the government readies a permanent cap on BP's stricken well, Gulf Coast residents have a new worry — whether they will be fully and fairly compensated for the damage the oil spill caused to their incomes and property. The administrator of the $20 billion fund BP established to pay out compensation claims, Kenneth Feinberg, needs to show some latitude, both in terms of how much he awards to whom and the deadline that residents face to tally their losses. The impact of the spill may not be known for years, and residents should not be forced to play guessing games with their livelihoods.

Feinberg will need to show the same level head he displayed in administering a similar fund for victims of the Sept. 11 attacks. In taking over the claims process from BP Monday, he promised to get money quickly to people who deserve it. Feinberg hit many of the right notes. He shows a sense of immediacy and is sensitive to the reality that the seafood and fishing industries especially can be cash businesses — hence the need for reasonable policies on documentation. But Feinberg needs to rethink two proposals that would be unfair to workers and could sharply weaken their ability to recover.

One idea calls for considering a claimant's "proximity" to the spill in assessing damages. As administrator, Feinberg clearly needs to make assumptions and value judgments as he decides these cases. But the geography of the spill is not the geography of the impact. As the government's point man in the disaster, retired Coast Guard Adm. Thad Allen, pointed out many times, the spill did not evolve as a monolithic leak but as thousands of smaller outbreaks of oil across hundreds of miles of shoreline along four gulf states. It closed tens of thousands of square miles to commercial fishing, some even farther south than the Tampa Bay area. The gulf economy is interconnected, and the compensation fund must recognize that.

Feinberg should drop another proposal that would deduct the wages fishermen earned cleaning up the spill from their final settlement with BP. Under federal law, the company is responsible to pay for both the cleanup and for lost incomes. But by allowing BP to deduct wages for fishermen involved with the cleanup, the company would essentially get the manpower for free. These fishermen would not have been put out of work were it not for BP's broken wellhead. And these workers risked their health, vessels and equipment to contain the ecological damage of the spill. Had they stayed home, they would not have faced the punishment under Feinberg's proposal to have their wages docked from any settlement. The idea turns responsibility on its head, and Feinberg should drop it before the public loses faith in his operation.

Feinberg also needs to ensure that residents have enough time to assess their personal impact from the spill before they agree to settle with BP. The November cutoff to apply for emergency assistance is reasonable. But the August 2013 deadline to apply for a final deal could be premature if there are environmental and other impact studies pending to measure the spill's long-term effect on fishing, tourism or property. Feinberg has time to massage the rules; the timetable and other criteria are not expected until the fall. He should not create a process that forces residents to be in the dark when they make these financial decisions. The gulf has suffered enough.